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TrevorS

Poor Get Richer, Rich Get Poorer

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Lowest inequality since 1986 as high incomes fall http://www.cityam.com/article/lowest-inequality-1986-high-incomes-fall:

"THE GAP between the largest and smallest incomes in the UK narrowed to its closest level for a quarter of a century in the 2011-12 financial year, the Office for National Statistics (ONS) announced yesterday. The rising level of equality has been attributed to the highest salaries falling, and changes to the tax system.

The richest fifth of households saw their average disposable income drop by £4,200, 6.8 per cent, between 2007-08 and 2011-12. In comparison, the average income for the poorest fifth has risen by 6.9 per cent, or £700 in the same period.

The changes to the tax system which are credited with reducing inequality include a higher personal income tax allowance, pushed by the Liberal Democrats, and changes to national insurance and child tax credits.

Before the tax and benefit system is taken into account, the highest-earning 20 per cent of people have incomes 14 times larger than the worst off 20 per cent. However, tax and welfare close the gap considerably. After both are taken into account, the UK’s richest fifth only earn four times as much."

Astonishing (and increasing) levels of redistribution required to sustain bubble-era housing costs and subsidise low-pay non-tax-paying employers. For the lowest 20%: income before taxes and benefits = £5,400, income after = £15,800 - almost triple!

Robin Hood would be cheered but the whole situation looks less and less sustainable. Brown really has painted them into a corner.

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I'd like to believe this, but, as noted, this looks more like the collapse of the middle class than a shrinking of the gap between the top and bottom.

That aside, I'm ambivalent regarding tax credits. In their favour, if employers won't raise wages, then they are an alternative way of shrinking the gap. Against - why should employers bother raising wages if the tax system is going to do it for them, and that's ignoring whether the balance is right with regard to who gets them and who doesn't. I'd also factor in the very rich largely avoiding tax in any event, but that's a general problem, rather than specific to tax credits.

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Lies, Damned lies and statistics. You can get all of this just by destroying the middle class. I'd be interested to know what has happened to the top 1%, instead of the "top 20%".

I think the top 1% make their money through rent seeking not through work. A fund I have has gone up by 30% in a year. If only I had just a few million invested in it.

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Lowest inequality since 1986 as high incomes fall http://www.cityam.com/article/lowest-inequality-1986-high-incomes-fall:

"THE GAP between the largest and smallest incomes in the UK narrowed to its closest level for a quarter of a century in the 2011-12 financial year, the Office for National Statistics (ONS) announced yesterday. The rising level of equality has been attributed to the highest salaries falling, and changes to the tax system.

The richest fifth of households saw their average disposable income drop by £4,200, 6.8 per cent, between 2007-08 and 2011-12. In comparison, the average income for the poorest fifth has risen by 6.9 per cent, or £700 in the same period.

The changes to the tax system which are credited with reducing inequality include a higher personal income tax allowance, pushed by the Liberal Democrats, and changes to national insurance and child tax credits.

Before the tax and benefit system is taken into account, the highest-earning 20 per cent of people have incomes 14 times larger than the worst off 20 per cent. However, tax and welfare close the gap considerably. After both are taken into account, the UK’s richest fifth only earn four times as much."

Astonishing (and increasing) levels of redistribution required to sustain bubble-era housing costs and subsidise low-pay non-tax-paying employers. For the lowest 20%: income before taxes and benefits = £5,400, income after = £15,800 - almost triple!

Robin Hood would be cheered but the whole situation looks less and less sustainable. Brown really has painted them into a corner.

Yup - I have posted on this a few times before.

The bottom 30%'s income have been rising relatively faster than those in the top 20% or so while the middle class got totally squeezed. This has been happening since the early 1990.

My theory is that during lower inflation period, there is less to be captured at the top and the bottom got their pay rises inline with inflation (their rate of inflation, which is higher in order to survive) while the middle suffers.

Also this: http://en.wikipedia.org/wiki/Income_in_the_United_Kingdom

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Lies, Damned lies and statistics. You can get all of this just by destroying the middle class. I'd be interested to know what has happened to the top 1%, instead of the "top 20%".

Also the top 1% have lots of ways to hide their money thanks to our insanely complex tax system and three decades of financial innovation. This Gini statistic could just be capturing the inability of government statisticians to figure out how much money the rich have.

Edited by Dorkins

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It's drivel.

The top level don't get their main income through salary they get it via other means, bonuses in shares, share options, whacking huge lumps into pensions just before they leave, etc.

For example FTSE CEO's strain to keep their base salary under £1m but finish up getting £4m or £5m overall.

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I'd like to believe this, but, as noted, this looks more like the collapse of the middle class than a shrinking of the gap between the top and bottom.

That aside, I'm ambivalent regarding tax credits. In their favour, if employers won't raise wages, then they are an alternative way of shrinking the gap. Against - why should employers bother raising wages if the tax system is going to do it for them, and that's ignoring whether the balance is right with regard to who gets them and who doesn't. I'd also factor in the very rich largely avoiding tax in any event, but that's a general problem, rather than specific to tax credits.

But is it wise to print these credits rather than make the wealthy pay for them?

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Lowest inequality since 1986 as high incomes fall http://www.cityam.com/article/lowest-inequality-1986-high-incomes-fall:

"THE GAP between the largest and smallest incomes in the UK narrowed to its closest level for a quarter of a century in the 2011-12 financial year, the Office for National Statistics (ONS) announced yesterday. The rising level of equality has been attributed to the highest salaries falling, and changes to the tax system.

The richest fifth of households saw their average disposable income drop by £4,200, 6.8 per cent, between 2007-08 and 2011-12. In comparison, the average income for the poorest fifth has risen by 6.9 per cent, or £700 in the same period.

The changes to the tax system which are credited with reducing inequality include a higher personal income tax allowance, pushed by the Liberal Democrats, and changes to national insurance and child tax credits.

Before the tax and benefit system is taken into account, the highest-earning 20 per cent of people have incomes 14 times larger than the worst off 20 per cent. However, tax and welfare close the gap considerably. After both are taken into account, the UK’s richest fifth only earn four times as much."

Astonishing (and increasing) levels of redistribution required to sustain bubble-era housing costs and subsidise low-pay non-tax-paying employers. For the lowest 20%: income before taxes and benefits = £5,400, income after = £15,800 - almost triple!

Robin Hood would be cheered but the whole situation looks less and less sustainable. Brown really has painted them into a corner.

Salaries smalaries. As any gdp vs wages graph will tell you, salaries aint what they used to be.

Where the rich clean up is unearned income. Property, shares, and income from.

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That aside, I'm ambivalent regarding tax credits. In their favour, if employers won't raise wages, then they are an alternative way of shrinking the gap. Against - why should employers bother raising wages if the tax system is going to do it for them, and that's ignoring whether the balance is right with regard to who gets them and who doesn't.

It certainly is. I'm not ambivalent, I'm massively against Child Tax Credits because it punishes people without children and showers huge amounts of money at people with children, to the point where they have them and expect the state to pick up the tab.

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It certainly is. I'm not ambivalent, I'm massively against Child Tax Credits because it punishes people without children and showers huge amounts of money at people with children, to the point where they have them and expect the state to pick up the tab.

There's a huge focus on getting more women into work - the government has said it sees it as the major way to get economic growth - yesterday in the Telegraph they were saying they might let schools do sleepovers fro children to make it easier for both parents to work

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There's a huge focus on getting more women into work debt- the government has said it sees it as the major way to get economic growth - yesterday in the Telegraph they were saying they might let schools do sleepovers fro children to make it easier for both parents to work take on debt

EFA. In 20 years they'll be wondering why we have a generation of poorly behaved kids. I say this as a father and single parent - encouraging both parents to spend less time with the kids only leads to more debt to service increasing costs and greater problems with children since they're spending such little time with their parents. It is not about equality. Of course, the state being in sole charge of raising the children is the statists' dream. And those statists are both socialists and the corporatocracy - ie the 3 main parties.

Edited by mikthe20

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There's a huge focus on getting more women into work - the government has said it sees it as the major way to get economic growth - yesterday in the Telegraph they were saying they might let schools do sleepovers fro children to make it easier for both parents to work

Even worse and still costs us money, doesn't tackle the problem :angry:

If you earn £20K and have 2 children, you take home a NET amount with benefits of over £23K

(You don't actually pay anything INTO the system until your salary is £24.5K)

If you earn £12K and have 3 children, you more than DOUBLE your salary and take home a NET amount over £24K

(You don't actually pay anything INTO the system until your salary is £29K)

Edited by mrtickle

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  • 242 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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